Wednesday, July 17, 2013

ADI's New Certification System; A Step In the Right Direction Or More Mud In The Water?

Over the weekend, the American Distilling Institute (ADI) announced a new certification program for craft spirits. You can read what ADI has to say about it here.

Clay Risen, in his 'Mash Notes' blog, describes the two certifications ADI is offering as "'Certified Craft Distilled Spirits' — distilleries that make everything in-house — and 'Certified Craft Blended Spirits' — which buy distillate or aged product but then add a step, like redistilling or further aging, that 'shows significant craftsmanship in the creation of flavor.' Of note, ADI insists that 'simply buying bulk spirits on the market and watering it to proof does not constitute craft and those spirits are not eligible.'"

If only the actual definitions were as simple and straightforward as Risen's paraphrase. Alas, they are not.

To be effective, a certification system has to be a couple of things. 'Trustworthy' is probably foremost, but 'unambiguous' and 'easy to use' are critical too. Unfortunately, ADI's new system raises questions on all three fronts.

The fact that ADI has launched this program with hundreds of products already certified hints at a not-very-rigorous verification process. According to the website, these were "pre-certified by ADI staff." Dig deeper and you'll see that what ADI offers is essentially self-certification. The producer submits an application and if they answer all of the questions correctly, they get certified. This is sometimes called first party certification. It is, in effect, an honor system.

As you read further, you learn that the only sin ADI seeks to banish is when 'large liquor conglomerates' create 'pseudo-craft brands' to 'share the spotlight' with craft brands. They continue:

"At a recent tasting in California, a major distributor operating in several states released the menu for their craft portfolio. It included such venerable 'craft' brands as Buffalo Trace, Woodford Reserve, Rittenhouse Rye and Jack Daniels Unaged Rye. These are all good whiskeys -- but craft? Apparently, there is some confusion here and education clearly needs to happen. If we don't educate the public, others will.
ADI is taking a stand to inform the distributors, the retailers, bartenders and general public, to clear up the confusion as to what brands are craft and what are not. To protect the distiller and aid consumers and buyers, who may have difficulty researching the background of every label, we have created a certification for craft produced spirits."

Certainly an admirable goal, but in what way is Breuckelen Distilling Company New York Wheat Whiskey, to pick one at random, more craft than Rittenhouse Rye? In other words, what is craft?

It's a question this blog has been asking so-called craft distillers since at least 2008.

Wikipedia offers this observation that's not quite a definition but addresses the dilemma well. "The mass production of goods by large-scale industry has limited crafts to market segments in which industry's modes of functioning or its mass-produced goods would not or cannot satisfy the preferences of potential buyers." That suggests that a craft-made product is one that has identifiable characteristics that cannot be found in mass-produced goods of the same type. It talks about the product, not the producer, and the product's characteristics.

Unfortunately, there is very little in the ADI certification process that ensures or even defines a ‘craft’ product. Instead, craft is equated with small and independent. If you are small and independent (and those terms are defined) then you're craft. The requirements that might be interpreted as referring to ‘craft’ are so vague, broad and contradictory that they include everything and exclude nothing, process-wise. For example, "Craft distillers produce spirits that reflect the vision of their principal distillers using any combination of traditional or innovative techniques, including fermenting, distilling, re-distilling, warehousing, infusing, or blending."

Warehousing? Infusing? Blending? In the definition of 'craft distilled spirit'?

Elsewhere, ADI seems to get at the crux of the matter. The 'craft distilled' definition requires that the product be "PHYSICALLY distilled and bottled on site." (Emphasis in the original) One wonders in what other state, other than physically, could the product be distilled and bottled on site? Is there some way a product can be distilled and bottled on site other than physically? Metaphysically?

The 'craft distilled' certification also requires a TTB-approved ‘distilled by’ label statement. That's more like it. Is ADI at least requiring applicants to submit their COLAs to prove compliance? There is no evidence that they are and some evidence that they are not. (The application doesn't ask for it.)

For example, a search of COLAs at TTB’s web site was unable to find a COLA for 'Widow Jane Wapsie Valley Whiskey,' a product on the pre-certified list. Window Jane is a brand name under which Cacao Pietro in Brooklyn is currently selling a rebottled Kentucky bourbon that they obviously did not distill. They also have an approved COLA for a 'Widow Jane Whiskey' that is distilled at Cacao Pietro. Using the same brand name for both would seem contrary to the desire for simplicity and transparency for the consumer. It's more like a bait and switch. Clearly, ADI's intention is for producers who sell both homemade and bulk products to clearly differentiate them. Is Cacao Pietro acting in that spirit? Or are they trying to obscure the difference, using the 'craft distilled' halo to sell a product made by one of the evil 'liquor conglomerates'?

A worse offender appears to be Old Smoky Distillery. They have 32 approved COLAs on file. They all say 'bottled by' not 'distilled by' on the label, yet there are four Old Smoky products on the ADI 'pre-certified' list that are 'certified craft distilled.' One is just identified as 'Old Smoky Moonshine.' Are there, in fact, four products in the huge Old Smoky portfolio that say 'distilled by' on their labels? Even if there are, how is the consumer supposed to separate them out? And doesn't Old Smoky, America's most-visited craft distillery, want everybody who buys a souvenir of their visit to believe that juice was all made right there?

It is widely known if perhaps not readily admitted that the Old Smoky Distillery makes only a fraction of the spirit it sells, which it supplements with very non-craft grain neutral spirit (i.e., vodka), bought from a 'large liquor conglomerate.'

So how useful is this certification to consumers? Perhaps the answer is here, in the ADI's explanatory materials: "The license to use this mark is now a benefit of full membership for qualifying DSPs that complete the application process." If you're little, and independent, and a full dues-paying member of ADI, then of course your products are craft. Here's a sticker that says so.

This is a brand new program and all of these issues can be addressed. Here's hoping that happens soon.

11 comments:

Great analysis, Chuck. Though I will say, you left the question in your title unanswered. You make a strong case that this just muddies the waters and is really just about building ADI's membership rolls. But you conclude by saying that all these issues you identify can be fixed. So which side do you come down on?

Another question: if someone buys a bulk whiskey and then redistills it on their still, is it legal for them to say that they distilled that whiskey? If they can, that would seem to blur the line between ADI's two categories.

And I'll just add one more thought: it disturbed me that Cleveland Whiskey was on the list. That outfit claims its proprietary technology can make "well-aged" whiskey in a matter of days -- presumably falling under ADI's approved list of "innovative" techniques. I understand they're a small, independent company, but their entire model violates the spirit of whiskey making, whether by a big distiller or small one.

The application and rules are hopelessly vague and circular. For example, a producer can qualify to promote the new ADI certification if it attests to the fact that it is not more than 25% owned by a non-craft distiller. So a craft distiller is one that's not more than 25% non-craft, whatever any of that means. (Note that "craft spirits" and "craft blender" are defined with a little more specificity beyond circular logic, such as maximum volume and independent ownership requirements, but "craft distiller" is not).

It's disappointing to me that ADI only bases the certification on membership in its organization and a self-serving attestation by the producer. Where is the third-party auditor? Since ADI's reputation and the value of certification is on the line if a producer is not truthful in their attestation, I would think it would be in ADI's best interests to audit.

I disagree with ADI's fundamental position that somehow the word "craft" makes everything better. I just want honesty in marketing, not "craft".

After seeing the list of pre-approved spirits, in addition to Chuck's other criticisms, I fear that seeing a new ADI sticker on a bottle will only identify for me the bottles I want to stay away from. Or, at least, I'll ignore the meaningless sticker and continue to do my own research into the company and tasting of their product. Anyway, I don't buy the bottles for the label but for what's inside.

I have a feeling that the ACDA will do something along these lines as well. As for an auditing system if the ACDA was to do it, other members would audit, and try to confirm one way or another whether there was some truth in what the little sticker certification says.

This isn't to say that I dont think ADI can figure it out, but they really need to look at tightening and more clearly defining the requirements, and let us know how they plan to ensure the distillers follow the rules. Do they have a area that someone can present evidence contrary to what a producer says?

This is from a PDF called "Craft of Whiskey Distilling" that was made by ADI in 2009. It is a decent definition that they seemingly have abandoned since making the PDF.

"Craft distillers produce alcoholic beverage spirits by distillation, or by infusionthrough distillation or re-distillation. Maximum production for a “craft” or “artisan”distiller should not exceed 250,000 proof gallons per year. The “craft” or “artisan” distillerutilizes a pot still, with or without rectification columns, for distillation of beveragespirits. A distiller starting with neutral spirits produced by others, who redistills withoutsubstantially altering the neutral character of the spirit may not be said to be a “craft” or“artisan” distiller."

If they get rid of the "Hands-on production" flaffle, which amounts to a condition I doubt could ever *not* be satisfied, the Certified Craft Distilled Spirit program may have some value for the consumer, if only because there'd be a certification NDP whiskeys don't have.

Is there a need for a Certified Craft Blended Spirit program? I get that it would be nice to be able to tell the difference between merely bottling purchased whiskey and actually doing something to the whiskey before bottling, but what makes what's done to the whiskey "craft"? "Harkening back to the frontier days, when the large cities had to wait patiently while the best bourbons were shipped East, our Whiskey is gently rocked and mellowed in specially designed containers until, at the peak of perfection, it leaves our Cornpone Hollow Rectifyin' Shed, ready for those with a discriminating thirst." If "the vision of their principal blender" is of dollar bills piled higher and higher, doesn't that make the spirits "craft"?

While you make some valid points, the miss-characterization of the ADI program as an honor system is incorrect and your argument is largely unsupported. Forgive me for characterizing your actions, but this really seems like a trial lawyer's tactic of discrediting a witness with mockery before moving on to the heart of the testimony, which in this case seems to be that the system is "self certification."

Actually, we do have the COLAs for all the pre-certified spirits. It was a pre-requisite to provide COLA in order to enter the ADI judging. The honor system argument denies the countless trips that Bill Owens, myself and other ADI staff have spent traversing the country, visiting craft distilleries and being intimately involved in their processes. We are not armchair quarterbacks. We talk to craft distillers for hours on a daily basis.

Do we make mistakes? Absolutely. Unfortunately, I missed that the Ole Smoky Tennessee Moonshine label did not say "Distilled by". It was a clerical mistake and it was made by me and no one else in ADI. I take full responsibility. The ADI web site has already been changed. Thank you for pointing out the error.

As mentioned, A COLA is nothing more than a label approval. The TTB's job to make sure it makes sense. Someone else should have the job, and Bless you Chuck, to get a grip on the Fakers v Makers situation and let the bottlers live in their own category. As a consumer I want to know who makes it (period) Craft distillers are clearly different. They have a much higher overhead and will command higher prices due to this. The bottler, or NGS buyer or whiskey bulk buyer eliminates all the equipment, the time, love and experience of something called a craft.The ADI is finally taken some steps to define this different. this new ACDA is all meat and no potatoes. And lastly did someone think they can buy whiskey and re distill it.. WHAT?

The significance of the COLA is that the consequences of lying to the TTB are greater than the consequences of lying to either ADI or consumers.

I look forward to ADI's online COLA database. Maybe this database can also include the field reports completed by Drew Faulkner, Bill Owens, and other ADI staff, as described by Drew in his comment above.

If this is not self-certification, then it's asking the consumer to take a big leap of faith with ADI. Why not make it easy by making everything transparent? Show the public the evidence.

While I agree that there needs to be more clarity in the industry regarding what is truly craft and what is not, having an organization like the ADI provide certification is like being told by Bernie Madoff that your account is insured.